Bill Baruch of Blue Line Futures has argued that decreasing bitcoin volatility might indicate that a bottom is forming

Looking at the data for bitcoin and other cryptocurrencies, the trend is clear, but the future is very hard to predict

A prominent market analyst has argued that the bitcoin market may be forming a bottom as the cryptocurrency’s volatility is decreasing.

In a segment for CNBC, Bill Baruch - president of commodities brokerage and trading company Blue Line Futures has argued that now that bitcoin price and volatility are more stable, the market may be able to form a bottom:

“Today I am watching bitcoin and it’s plumetting volatility, the volatility…is at the lowest level in more than a year…this is a sign that the selling has become exhausted.”

Bill Baruch

Observing that the bitcoin market peaked during the bull run of December 2017 when bitcoin futures contracts were launched, Baruch explained:

“Tremendous speculation and a fear of missing out sent prices in the sector skyrocketing too quickly, this sell off has wiped out most if not all of the overenthusiasm….. A bottom is a process not a price. Now that the price and volatility are back down to earth, this bottoming process can begin. I see significant upside from here in the long term.”

Bill Baruch

Arguing that a bottom would form more “quickly and constructively” if the low of $6,000 holds, the broker advised that the price of $10,000 is a crucial “line in the sand” for the leading cryptocurrency.

Market-wide Trend

Looking at the title graph from CryptoCompare, we can see that bitcoin’s 7-day volatility has decreased steadily since the frantic market of December of last year.

If we look at the 30-day exponential moving averages of both price and volatility - the blue and red lines on the graph - we can clearly see this steady decline.

Moreover, if we turn to the cryptocurrency market in general, we can see that the trend holds for the broader market, with XRP standing out with a particularly sharp decrease since December:

While it is always a dangerous game to make price predictions for cryptocurrencies, investors and market analysts alike will hope that the trend signifies that the end is in sight for this prolonged bear market.